Indian Startup Ecosystem Seeing 'Investor' Crisis


Bangalore: India has been falling short of promising start-ups as they are struggling to find investors these days. According to internet entrepreneur Nameet Potnis who is finding ways out by setting up Nurtured.in – a platform to link startups with investors, says that investors are reducing the risk-taking appetite and that it is easy to set up businesses in India, but very difficult to do them.

Ever since Narayan Muthy has created a leading IT outsourcer named Infosys, new entrepreneurs are yet to find such ‘favourable business environment’. Analysts have noted that only 5 percent of thousands of Indian startups get funds from external sources or friends or family and a 2012 report by U.S. based Startup Genome states that it is one of the toughest countries in the world for a start-up to flourish.

Looking at the numbers as shown by Venture Intelligence (which is based in southern Chennai), venture capitalists invested $1.09 billion through 222 deals in 2011 and this dropped by 30 percent to $762 million through 206 deals in 2012.

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